Corporate Accountability

Jesner, et al. v. Arab Bank, PLC

In Jesner, et al. v. Arab Bank, PLC, the Supreme Court considered whether corporations may be sued under the Alien Tort Statute (ATS), which allows the federal district courts to hear suits for torts “committed in violation of the law of nations or a treaty of the United States.”

Case Summary

Between 2004 and 2010, five separate lawsuits were filed in U.S. District Court claiming that Arab Bank, a multinational corporation based in Jordan, knowingly used its New York branch to finance international terrorism that led to suicide bombings and other attacks that resulted in the death, capture, or injury of thousands of innocent civilians in Israel, the West Bank, and Gaza. Victims of these terrorist attacks, their family members, and representatives of their estates all sued under the ATS. The Second Circuit Court of Appeals dismissed the suits on the ground that corporations cannot be sued under the ATS for violating the rights of individuals protected by the law of nations. The plaintiffs filed a petition for a writ of certiorari with the Supreme Court, which agreed to hear the case.

CAC filed a friend-of-the-court brief in support of the plaintiffs. In our brief, we argued that the Second Circuit’s interpretation of the ATS is inconsistent with both the text and history of the ATS and fundamental principles of corporate personhood, which permit corporations to be sued for wrongdoing. First, the text of the ATS does not distinguish among possible defendants, permitting suits against all defendants including corporations and other artificial entities. Corporations, like individuals, are bound by fundamental international norms held by all civilized nations. Indeed, the Second Circuit’s interpretation undermines the Framers’ purpose for enacting the ATS, which was to provide a federal forum to redress violations of international law. Second, from the Founding on, it has been the law that corporations may be sued for torts committed by their agents. Under these long-established principles, corporations are liable under the ATS for torts committed in violation of the law of nations to the same extent that individuals are.

The Court ruled, 5-4, that corporations cannot be sued under the Alien Tort Statute.  In dissent, Justice Sotomayor echoed arguments made in our brief, explaining why the majority’s decision got the text and history of the ATS wrong.  She also noted the irony in the majority’s decision: as the Roberts Court has rewritten the Constitution and federal laws to give corporations the same rights as individuals, the Court’s ruling in this case gives corporations greater rights than individuals and makes it impossible to hold corporations accountable when they violate basic human rights norms.

Case Timeline

More from Corporate Accountability

Corporate Accountability
July 2, 2024

QUICK TAKE: Corporate Interests at the Supreme Court, 2023-2024 Term

Conservative supermajority discards precedent, shifts power to judges, and hobbles agency efforts to enforce the...
By: Brian R. Frazelle
Corporate Accountability
June 24, 2024

The Supreme Court’s War on Working People Just Got a Little Worse

Balls and Strikes
The decision in Starbucks Corporation v. McKinney is part of a long tradition of the Supreme Court...
Corporate Accountability
U.S. Court of Appeals for the Fifth Circuit

Intuit, Inc. v. Federal Trade Commission

In Intuit Inc v. Federal Trade Commission, the United States Court of Appeals for the Fifth Circuit is considering whether the FTC’s authority to issue cease-and-desist orders against false and misleading advertising is constitutional.
Corporate Accountability
June 20, 2024

RELEASE: In narrow ruling, Supreme Court rejects baseless effort to shield corporate-derived income from taxation

WASHINGTON, DC – Following this morning’s decision at the Supreme Court in Moore v. United...
By: Brian R. Frazelle
Corporate Accountability
June 13, 2024

RELEASE: Supreme Court’s Disappointing Decision in Starbucks Union Case Fails to Account for History

WASHINGTON, DC – Following today’s decision at the Supreme Court in Starbucks Corp. v. McKinney,...
By: Smita Ghosh
Corporate Accountability
May 30, 2024

Supreme Court gives New Yorkers second shot in escrow interest-payment fight

Courthouse News Service
WASHINGTON (CN) — The Supreme Court on Thursday gave New York homeowners another shot at...
By: Smita Ghosh, Kelsey Reichmann